Can GameStop type forum in India influence retail investors’ behaviour?
Regulators in India should take note of the GameStop saga and keep a strict vigil on social media to avoid something like this happening in Indian markets.
Source: Reuters
Atish Matlawala
What has happened in GameStop is something really amazing and has never happened before. Reddit’s WallStreetBets forum which is a group of 3 million day traders gathered and conspired to take long positions in GameSpot which made hedge funds to square off their short positions.
To put things in perspective, short-sellers in GameStop lost $ 5 billion in mark-to-market losses in the month of January, and on Tuesday alone they made a loss of $867 million as the stock rallied 95 percent in one single session.
The government’s focus in the upcoming Budget is likely to be on providing acceleration to the economic recovery which has been underway over the past few months, says Bhobe.
While everyone is celebrating retail traders winning over a large hedge fund, it rarely ever plays out this way. Mostly, retail ends up losing money when there is excessive speculation, says Kamath.
Nearly Rs 10 lakh crore gone ahead of Budget: what should be your investment strategy?
The trading strategy on the Budget Day should be to pick stocks from their support levels and keep an eye on reversal patterns instead of picking stocks which are trading in a range or are at higher levels. January 29, 2021 / 01:06 PM IST
Five days of the selloff on D-Street pushed Sensex and Nifty50 below crucial support levels. The S&P BSE Sensex plunged more than 3000 points since January 20 while Nifty50 is down by about 1000 points in the same period.
The average market capitalisation of the BSE-listed companies fell by about Rs 10 lakh cr in just five sessions. The market capitalisation of the BSE-listed companies fell from Rs 197.70 lakh cr to Rs 188.13 lakh cr as of January 28, 2021.
Stocks like India Cement fell more than 5 percent, Bank of Baroda fell more than 9 percent, and HDFC Bank was down by nearly 3 percent were some of the stocks in focus.